Facebook seeks D.C. friends amid privacy talk

Social networking

Sara Forden, Bloomberg News

Published
4:00 am PST, Friday, December 3, 2010

Palo Alto's Facebook is expanding its Washington office and consulting with privacy advocates as lawmakers question how well the world's largest social-networking site protects the personal information of users.

The company is looking for a public-policy expert and a deputy press spokesman, following the June hiring of Marne Levine to head its Washington office. Levine is a former top aide to Larry Summers, director of President Obama'sNational Economic Council. The new hires would bring Facebook's Washington team to eight, up from zero three years ago.

Tighter privacy rules being discussed in Washington might limit the ability of companies such as Facebook and Google to tailor ads to users of their sites and curb sales growth. Google reported a 23 percent increase in sales to $20.9 billion, almost all from advertising, for the first three quarters of this year.

Facebook revenue may double to $1.4 billion this year, two people familiar with the matter told Bloomberg News in August.

"A lot of people think Facebook could become bigger than Google, but privacy could be the real Achilles' heel for this company," said Sunil Gupta, a professor at Harvard Business School whose research areas include new media. "Privacy will be a huge issue, both in Washington and overseas."

Congress, the Federal Trade Commission and the Commerce Department are considering how to impose additional privacy safeguards on Internet companies that amass user data, and the White House in October established a task force of more than a dozen federal offices to address privacy concerns.

The FTC on Wednesday called for a "do not track" option for Internet users to allow them to block monitoring of their online movements, used to compile profiles for marketers.

"Some consumers are troubled" by the tracking, the agency's staff said in a report. "Others have no idea that any of this information collection and sharing is taking place."

Privately owned Facebook says it has more than 500 million users worldwide, including more than 150 million in the United States. It channels communication among subscribers who approve access by people considered "friends," and helps advertisers target consumers based on user demographics and interests.

The company says it gives users the ability to determine how much information they share, and that Facebook policies prohibit revealing details that identify individuals to third parties.

"When we talk with policy makers about Facebook, it's about how users have control over information," Levine said in an interview.

Facebook triggered an outcry in April after it added a feature that automatically connected users to three outside websites unless they specifically opted out of the service. After complaints from privacy groups and lawmakers, Facebook in May introduced simpler privacy settings and said it was reducing the amount of publicly available user information.

"Facebook is a ticking privacy time bomb, no matter how much they spend in lobbying," said Jeffrey Chester, executive director of the Center for Digital Democracy in Washington, which has urged the FTC to address privacy issues at Facebook and other online marketers.